RIO Tinto sold the majority of its stake in US coal miner Cloud Peak Energy yesterday for $499m (£320m).
After divesting 25.6m shares at $19.50 per share, London-listed Rio will be left with a 6.2 per cent stake in Cloud.
However, this remaining stake may also be sold through an over-allotment option if demand for the shares is high. This would generate a further $74.1m. The transaction is expected to close on 21 December.
Rio kept a 48 per cent stake when it spun off Cloud in November 2009 as part of its initial public offering (IPO).
“The pricing of the secondary offering demonstrates another successful outcome of our overall divestment strategy,” said Guy Elliott, chief financial officer at Rio.
“With the proceeds from the Cloud Peak Energy transactions and the sale of Jacobs Ranch, the total gross proceeds for the divestment of the majority of Rio Tinto Energy America will be at least $2bn,” he added.
Credit Suisse, JP Morgan and Morgan Stanley are acting as joint book-running managers on the offering.
Rio, the world’s third-largest mining group by market capitalisation, has been selling its assets since February 2008 in an attempt to pay down debt after commodity markets collapsed in 2008 following its purchase of Canadian aluminium group Alcan.
Total proceeds from the divestment of its US coal unit, Energy America, comprising Cloud Peak and the separate sale of Jacob’s Ranch, would total at least $2bn, Rio said.
Rio’s shares closed 0.6 per cent lower yesterday at 4,405.5p.